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Full text of "Shipping Practice"

CHAPTER XVII
VOYAGE ESTIMATES

THIS chapter is not intended to deal with the operation of
accountancy in relation to the records kept for every voyage
that a ship may make, but only to make reference to the
estimating for fixing purposes.

In the case of ordinary berth shipments, where a vessel
loads whatever cargo may be offered to her, at the rates
which are agreed by the various Conferences, there is no
necessity for an estimated voyage account.

When an owner has an opportunity to quote for a fixture,
he must know what figure he is to offer the broker in order
to secure a profit, and an estimation of his proposed earnings
and expenses is made.

The estimated expenses are ascertained, and the division
of this amount by the number of tons of cargo to be carried
results in the cost per ton of transportation. To this amount
is added the profit desired, and the rate of freight for
quotation purposes is found.

If the fixings are calling for a higher rate, then his per-
centage of profit is increased. If, however, rates are low,
then he knows at what rate he may quote in order to clear
his expenses and also avoid a loss.

It is sometimes to the advantage of an owner in times of
depression to secure a cargo at a rate which will produce a
small loss, for although out of pocket to the extent of his
financial loss he has retained a hold of trade, and does not
incur expense in laying up his vessel* Charges for laying
up are variable, and an owner who wishes to lay a steamer
up for a period of time naturally finds accommodation at the
cheapest places.

A vessel laid up tends to deteriorate at a far quicker
rate than when it is actually operating.

It is often found that in times of bad trade a new vessel
is built and immediately laid up. This is accounted for by

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